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Baker administration does not appear to have projected the impact of higher state funding on direct-care wages
(COFAR Intern Joseph Sziabowski contributed to the research for this post.)
On July 28, Governor Baker signed the Fiscal Year 2023 state budget, which, among other things, directed for the first time that hundreds of millions of dollars be spent to raise the wages of direct-care staff working for corporate human services providers.
But more than a quarter of the way through the fiscal year, questions remain about the legislation, including the amount by which those wages will be raised.
The budget provision appears to be a big win for thousands of caregivers in the Department of Developmental Services (DDS) system, whose low wages have resulted in staffing shortages that have reached critical levels. Up to that point, the administration and Legislature appeared to have done little to address the staffing crisis.
However, neither DDS nor the Executive Office of Health and Human Services (EOHHS) appear to have projected the level to which the average direct-care wage in Massachusetts will increase due to the budget legislation.
The legislation (line item 1599-6903 of Chapter 126 of the Acts of 2022), specifically requires that any corporate human services provider receiving state funding under a special provider reserve account direct at least 75% of that funding to compensation for direct-care and front-line staff.
The legislation appropriated $230 million for the provider reserve account for Fiscal 2023. The 75% funding provision would appear to require that a total of $173 million in the reserve account be directed by human services providers to boost direct-care wages.
The legislation, however, did not set a target wage for direct-care workers that providers would be expected to pay under the line item funding requirement. The budget line item, in fact, implies that the Legislature does not currently know what the wage distribution is for direct-care workers in Massachusetts.
In our view, it is problematic that despite appropriating hundreds of millions of dollars in funding to the providers, neither the administration nor the Legislature appear to have set a goal as far as wages of the providers’ direct-care workers are concerned.
COFAR has called for a target minimum wage of $25 per hour for those workers. The U.S. Bureau of Labor Statistics (BLS) lists an average direct care wage of $16.80 throughout the country as of May 2021. (The BLS wage category is Social and Human Services Assistants in Residential Intellectual and Developmental Disabilities facilities.)
There is a difference of more than $8 per hour, or nearly 50%, between the average direct care wage in the nation and what COFAR has proposed for workers in Massachusetts. But whether our goal or something considerably less might be achieved by the budget legislation is apparently unknown.
It also isn’t clear that the increased funding will actually find its way to the direct-care workers and will not be diverted to the provider executives. In our October 12 email query to both EOHHS Secretary Marylou Sudders and DDS Commissioner Jane Ryder, we also asked if the administration had issued any guidance to providers regarding the payment of higher direct-care wages, and how the money would be audited and tracked. As noted, we have not received any answers to those questions.
Legislative staffer assumes there is no wage projection
In response to the questions above, which we also posed to the Legislature’s Children, Families, and Persons with Disabilities Committee, a committee staff member said she had been informed by EOHHS that the administration has “set benchmarks from which providers choose to pay their direct-care workers – so pay rate decisions on exceeding those rates are still up to providers for the privatized group homes.” The benchmarks appear to be the BLS average wages noted above.
The legislative staffer added that, “I take this to mean they (the administration) don’t have projections for a raise in wages, whether they will exceed the benchmark rates or not. They will at least have to be at the benchmark rates.”
In other words, the administration appears to be concerned only that current and future rates paid by providers to their direct-care workers in Massachusetts be comparable to the national average rates calculated by the BLS.
Legislature does not know direct-care wage distribution
The Legislature, in fact, does not appear to know what the current wage distribution is for direct-care workers in the state’s human services system.
The Fiscal 2023 budget line item states that EOHHS to provide the Ways and Means committees as of March 3 of next year with a comparison of the median wages earned by direct-care and other workers in Massachusetts with the 75th percentile wage estimate by the BLS.
What that seems to mean is that the Legislature would like to know whether direct-care workers in Massachusetts are in the upper quarter of the BLS wage range in the country. That still would not require EOHHS to project the likely impact of the requirement in the Fiscal 2023 budget that the providers spend 75% of their reserve fund revenues on raising those wages in Massachusetts.
Baker takes credit for increased funding to providers
On October 3, Governor Baker “touted” increases in funding his administration has provided to the corporate human services providers — more than $800 million since 2015, according to The State House News Service. But in his remarks to the Massachusetts Providers’ Council, Baker apparently didn’t address the potential impact of the increases on direct-care wages.
In the same article, the News Service noted that, “The human services sector has struggled for years to attract and retain workers due to the combination of lackluster pay and the difficult nature of the work.”
The article didn’t question why a nearly billion-dollar increase in provider rates would not substantially raise the “lackluster pay” to the providers’ workers.
As we reported in August, much of that money appears to have gone to the providers’ executives. Between Fiscal Years 2012 and 2020, total compensation of CEOs, executive directors, and other DDS provider executives doing business in Massachusetts rose from $102.4 million to $125.5 million. That was a 23% increase.
Also, the average compensation paid per executive rose in that period from approximately $161,000 to $184,000 — a 14% increase.
As we have previously reported, both the state auditor and inspector general have found that increased state funding to the providers hasn’t necessarily translated into higher direct-care wages.
We are hopeful that this year will mark a meaningful increase in direct-care worker pay. But thus far, there has been no information as to what the actual impact of the increased funding will be on those wages.
UPDATE: Senate budget amendment is redrafted to require that provider funding go to direct care workers
After COFAR questioned a state Senate budget amendment earlier this week that would provide almost $600 million in funding to corporate human services providers without requiring that any of that funding be spent to boost wages for direct care workers, we’ve learned that the amendment was redrafted yesterday to include that requirement.
According to the redraft of Amendment 466, any human services provider receiving funding under a budgetary provider reserve account must direct at least 75% of that funding to compensation for “direct care, front-line and medical and clinical staff.”
Amendment 466, which has been filed by Senator Adam Gomez, Senate chair of the Children, Families, and Persons with Disabilites Committee, would also increase the provider reserve account from $79 million to $581.6 million in Fiscal Year 2023.
The direct care compensation requirement in Senator Gomez’s redrafted amendment is now identical to language adopted by the Senate Ways and Means Commitee last week with regard to the reserve account, known as the Chapter 257 account.
In a blog post on Tuesday, COFAR reported that the original draft of Gomez’s amendment would significantly raise the reserve account level while eliminating the 75% direct care wage funding requirement. The redrafted amendment both raises the reserve account level and includes the 75% requirement.
On Monday, I had sent an email to Senator Gomez and his staff, which was based on the original language in Amendment 466. In my message, I said we were concerned that without specific language requiring that funding in the reserve account be used for direct care wages, there is little or no assurance that adoption of his amendment would lead to higher wages for those workers.
No one from Gomez’s office has yet responded to my email. But we were informed yesterday that the senator’s office had redrafted the amendment to include the 75% funding requirement, and that the requirement had reportedly been left out of the orignal draft “by mistake.”
The redraft of Amendment 466 is available on the budget page of the Legislature’s website.
Senator Gomez’s redrafted amendment would still add more than $350 million to the amount approved for the provider reserve account by the Senate Ways and Means Committee. The Ways and Means Commmittee approved $230 million in funding for the account for the coming fiscal year — the same amount proposed by Governor Baker and approved by the House last month.
Based on a request by a coalition of provider organizations, Senator Gomez’s amendment would bring the total reserve account funding to $581.6 million.
The Senate is scheduled to vote next week on the budget for Fiscal Year 2023 and on amendments filed to it.
Under the Senate Ways and Means budget plan, the 75% funding provision would appear to require that $173 million in the reserve account be directed by human services providers to boost direct care wages.
Based on the much larger funding total in Senator Gomez’s amendment, the amount directed to direct care wages would appear to be $436 million.
All of this still leaves a number of questions. For instance, how much would the $436 million funding requrement actually boost direct care, front-line, and medical and clinical staff wages? Is the 75% language sufficient to ensure that the money would indeed go to those workers?
As we reported earlier this week, both the state inspector general and the state auditor have found that controls are needed over spending by the providers to ensure that the funding goes to direct care workers.
In the House, a budget amendment, which was rejected last month, would have required that the providers sign a form attesting to a plan for spending the reserve account funding. Neither the Senate Ways and Means language nor Senator Gomez’s amendment contain that attestation requirement.
It’s also the case that while the Senate now will approve a 75% funding requirement regarding the reserve account, there is no such requirement in the House version of the budget. So a House-Senate conference committee will have to decide whether the 75% provision stays in the final budget.
But even with those questions surrounding it, we still support the 75% funding provision, and hope it stays in the final budget.
House leadership rejects budget amendment to raise direct care wages
Despite support from well over a majority of the Massachusetts House of Representatives for a state budget amendment that would raise wages of direct care workers in the Department of Developmental Services (DDS) system, the amendment was rejected on Tuesday (April 26) by House leaders.
Debate concluded yesterday (April 27) in the House on a $49.7 billion state budget for Fiscal Year 2023, which begins on July 1. The budget legislation now goes to the Senate Ways and Means Committee.
Amendment 788 to the House budget bill would have required that 75% of funding in a reserve account for state payments to corporate human services providers go toward boosting wages for their direct care workers.
As COFAR has recently reported, low pay has become a recognized cause of staffing shortages in the state’s human services system. COFAR has called for a minimum wage for direct care workers in the DDS system of $25 per hour. Right now, the average hourly rate for these workers appears to be $16 or possibly even less.
In January, Governor Baker had proposed placing $230 million in the provider reserve account, an amount almost three times the size of the account’s current-year funding. Amendment 788 would have required that 75% of the account, or some $173 million, be used to boost direct care wages.
It isn’t clear to us how much the 75% funding requirement would have raised those wages. On Wednesday, I contacted the office of Representative John Mahoney, the chief sponsor of Amendment 788, for more information about the measure. I’m waiting to hear back from his office.
House leadership ignores legislative support
In the absence of current legislation to raise direct care wages to $25 per hour, we had urged support for Mahoney’s amendment. As of April 22, the amendment had garnered 44 co-sponsors. Three days later, that number had jumped to 107 co-sponsors out of the 160 member House. That is more than two thirds of the total House membership.
However, the budget process in Massachusetts does not generally allow for votes in the House on individual amendments. Instead, legislative leaders, including the House speaker and the chair of the House Ways and Means Committee, appear to make the decisions as to which amendments survive and which fail.
In a November 2021 paper, a working group of the Progressive Democrats of Massachusetts included the following statement from an observer of the legislative budget process in this state:
… during the House budget process, there are thousands of amendments. They’ll (legislative leaders) go into the backroom and then come back out with ten consolidated amendments and that’s all that’s on the record for a vote.
In other words, rank-and-file legislators are allowed to vote only on “consolidated amendments,” which are bundles of individually proposed amendments that have been deemed acceptable by the leadership. In this case, the language of Amendment 788 was not accepted into a consolidated amendment.
HHS secretary reportedly testified in support of 75% of funding for direct care wages
Despite the decision by the House leadership to scuttle Amendment 788, even state Health and Human Services Secretary Marylou Sudders reportedly implied her support for the idea of earmarking 75% of state funding to providers to be used for direct care wages.
At a March 7 legislative hearing, Sudders testified that, “it might be time for the state to consider mandating a percentage of rates paid to private providers be used for salary enhancements,” according to the State House News Service.
The News Service then quoted Sudders as saying, “Maybe we need to say 75 percent of our rates have to go to direct care salaries.”
On March 21, I sent an email query to EOHHS, asking whether Sudders was indeed supporting the idea. I also asked whether EOHHS had an estimate or projection of the amount to which such a requirement would raise direct care wages. To date, I haven’t received a reply to that query.
I also asked in that query whether Sudders would support legislation to require a minimum wage for direct care workers of $25 per hour.
Currently, the only legislation that appears to remain on Beacon Hill that addresses the issue of direct care wages is S.105. a bill that would require that the state provide funding to providers to close a “disparity” in wages between provider-based workers and state workers. That bill was filed more than a year ago and has remained since February in the Senate Ways and Means Committee.
As we noted recently, the intent behind S.105 appears to be good in that it would potentially boost the wages specifically of direct care workers in provider-run group homes and other facilities in the human services system. But the bill doesn’t specify either a minimum wage for those workers or the amount of the wage disparity that the bill sponsors are seeking to close.
COFAR also seeking higher funding for state-operated group homes and developmental centers
COFAR has also pushed during the current budget process for higher funding for DDS developmental centers and state-operated group homes.
The House budget bill approved yesterday contains the governor’s proposed 6.2% increase for the state-operated homes and 5.1% increase for the Wrentham and Hogan Developmental Centers. However, since January, inflation in New England has climbed to 7.4%, according to the Bureau of Labor Statistics inflation site.
As a result, the nominal dollar increases approved by the House in the state-operated group home and developmental center line items amount to cuts when adjusted for inflation.
There is a need for action to address pressing problems within the DDS system, particularly with regard to direct care wages and to preserving state-run residential services. Those services are critical to maintaining adequate care for some of the most vulnerable among us. Unfortunately, we’re up against a political system in Massachusetts that is not fully responsive to its constituents.
Questionable effectiveness and little progress appear to characterize state’s efforts and proposals to raise direct care wages
With low pay a recognized cause of staffing shortages now endemic to the the state’s human services system, we are concerned about an apparent lack of urgency and effort by the administration and the Legislature in raising direct care worker pay.
We have called for a minimum wage for direct care workers in the Department of Developmental Services (DDS) system of $25 per hour.
Thus far, we haven’t been able to get key lawmakers or administration officials even to comment on our proposal. Those officials are similarly mum regarding the potential impact of their own proposals.
Meanwhile, as the staffing shortage problem drags on month after month, a lack of timely action by lawmakers and the administration to address it is especially frustrating given the state’s strong financial condition and projected surplus revenues.
Over the past several months, the Baker administration has distributed federal funding for only a one-time, 10% increase in wages under last year’s American Rescue Plan Act (ARPA). But those wage increases, which have been paid by at least some providers to workers in the form of bonuses, are not the basis of a permanent increase in their pay.
Questions about current bill to raise wages
A key bill in Massachusetts that is intended to boost direct care worker wages permanently is S.105, which was filed by state Senator Cindy Friedman. As Senate chair of the Health Care Financing Committee and vice chair of the Senate Ways and Means Committee, Friedman is one of the most influential and powerful members of the Legislature.
The intent of Senator Friedman’s bill appears to be good in that it would potentially boost the wages specifically of direct care workers in provider-run group homes and other facilities in the human services system.
But the bill doesn’t specify a minimum wage for those workers. Rather, it calls for an unspecified amount of state funding to close an apparently as-yet unquantified “disparity” in wages between provider-based workers and state workers.
I first contacted Friedman’s staff in early February to ask if they had an estimate of the amount to which her bill would raise direct care wages. I haven’t gotten an answer from her office on that.
Last week, after I renewed my query, Friedman’s communications director emailed me to say that Friedman “will be holding off on any official comment (regarding her bill) until the bill is finalized through committee.”
Friedman’s bill was reported favorably by the Children, Families, and Persons with Disabilities Committee in February, and sent to the Senate Ways and Means Committee. Prior to that, the Children and Families Committee had sat on the bill for almost a year.
I’m not sure what “finalized through committee” means, but I assume it means that Friedman won’t comment on her bill unless and until it is reported favorably by the Senate Ways and Means Committee.
It’s not clear why Friedman won’t publicly comment on her bill while the Senate Ways and Means Committee is still considering it. Legislators are generally eager to comment on bills they have proposed unless they either don’t fully support the measures or possibly don’t have answers to questions about them.
I wrote back to Friedman’s communications director, Stephen Acosta, last week, listing what I think are potential problems with the bill, or at least unanswered questions about it. We think a bill that specifies and requires a minimum wage for direct care workers would be a potentially more effective piece of legislation.
Among the problems or questions we have about Friedman’s bill are the following:
“Disparity” apparently hasn’t been quantified
The “disparity amount” is defined in the bill as “the monetary calculation of the average difference in salary” between direct care workers in provider organizations that contract with the state, and workers who are employed directly by the state.
Friedman’s bill would require the Executive Office of Health and Human Services (EOHHS) and other agencies, in collaboration with the Council of Human Service Providers, Inc., to calculate the amount of the disparity, and report back to the Legislature as of July 1.
Those entities would also be required to calculate the amount of state funding that must be appropriated to the providers to reduce the disparity over a five-year period ending in July 2027.
Friedman’s bill is a tacit admission that state workers are paid more for direct care work than are workers in provider agencies. But it appears that no one in the administration or Legislature currently knows what the difference in pay is.
As we have previously reported, the amount of that disparity has apparently only been “guesstimated,” and the guesstimate is that the disparity is roughly 20 percent. That guesstimate came from a staff member of the Children and Families Committee.
The federal Bureau of Labor Statistics lists an average hourly wage for “personal care aides” in Massachusetts of $16.29. Personal care aides, according to the BLS, include workers in both group homes and private homes.
If the Children and Families guesstimate is correct, it appears that even after five years, Friedman’s bill would raise the wage of a worker making $16 an hour to roughly only $19 – a level nowhere near $25.
Disparity would take five years to eliminate
We’ve written frequently about the need to raise direct care wages in order to address the ongoing staffing shortage affecting the entire DDS system.
Under S.105, state agencies, including EOHHS, would be required to raise funding for human services providers to reduce the wage disparity amount to 50 percent by July 1, 2023, and to zero by July 1, 2027.
Given the state’s current surplus in revenues, it seems to make little sense to wait for five years to fully fund the solution to a problem that is affecting the system and people’s lives right now.
No method of ensuring the money would go to direct care workers
Friedman’s bill states that, “ All increases in the rate of reimbursement provided (to human services providers) shall be used to increase the compensation of human services workers.”
But there are no specifications in the bill of any amounts that individual providers would be required to pay those workers. There is also no requirement that the providers show that the additional funding they receive under the legislation has, in fact, gone to direct care workers.
Approach has been unsuccessful in the past
In 2019, State Auditor Suzanne Bump found that a major boost in state funding in previous years had resulted in surplus revenues for providers, but had led to only minimal increases in wages for direct care workers.
Bump’s audit concluded that the increased funding, which was at least partly intended to boost direct care wages, “likely did not have any material effect on improving the financial wellbeing of these direct care workers.”
Bill based on average wages, not a minimum wage.
S.105 refers to eliminating an “average difference in salary” between provider-based and state workers. That could allow some providers to pay less than the average if others pay more.
We are calling for a minimum wage for direct care workers of $25 per hour. So, even if S.105 were to achieve an average wage of $19 an hour after five years, it would still imply a minimum wage of less than $19. That is another reason why it doesn’t appear that Senator Friedman’s bill would raise the minimum direct care wage to the neighborhood of $25 an hour.
Sudders has suggested a different approach to raising direct care wages
According to a March 7 State House News Service article, Health and Human Services Secretary Marylou Sudders testified that, “it might be time for the state to consider mandating a percentage of rates paid to private providers be used for salary enhancements.”
The News Service then quoted Sudders as saying, “Maybe we need to say 75 percent of our rates have to go to direct care salaries.”
Sudders was testifying at a hearing before the Joint Ways and Means Committee, which Friedman was co-chairing, according to the News Service. During the hearing, Sudders acknowledged workforce shortages in the human services sector.
The 75-percent idea has also been proposed before. In 2020, a bill would have required providers to use up to 75 percent of their total state funding to boost direct care worker salaries to at least $20 per hour. State Sen. Jamie Eldridge proposed a similar measure in 2017. Neither of those measures was enacted by the Legislature.
On Monday (March 21), I emailed EOHHS’s media relations manager, asking whether the agency had an estimate or projection of the amount to which such a 75-percent requirement would raise direct care wages. I also asked whether EOHHS had a figure regarding the current percentage of funding to providers that goes toward direct care wages.
Finally, I asked whether Secretary Sudders would support legislation to require a minimum wage for direct care workers of $25 per hour. I have also previously posed that question to Senator Friedman and the co-chairs of the Children and Families Committee.
So far, we haven’t gotten any responses to these questions. We urge people to call their state legislators and ask them to act on a $25 minimum wage for workers in the DDS system.
You can find your local legislators here.
Staffing shortages and low pay affecting care in DDS group homes
As the Department of Developmental Services (DDS) system in Massachusetts emerges from the COVID crisis, a number of systemic problems are lingering, including reports of staffing shortages in group homes.
The staffing shortages may not be directly due to the pandemic, but the pandemic may have brought matters to a head.
Staffing shortages have long been a potential result of the low pay provided to direct care workers in the DDS system compared with high salaries provided to executives managing the nonprofits operating most of the group homes.
Even with a $4.2 billion surplus in state budget revenues projected for the current fiscal year, there appears to be no sign of urgency on Beacon Hill to address the direct care wage problem. Legislation (H.4171) that would have boosted minimum direct care wages in the DDS system to $20 per hour died at the end of the previous legislative session last December, and apparently hasn’t been revived.
We sent an email query on July 13 to state Health and Human Services Secretary Marylou Sudders and DDS Commissioner Jane Ryder, seeking confirmation of the staffing shortages and reasons for them. We sent a similar query to the Legislature’s Children, Families, and Persons with Disabilities Committee.
In our emails, we asked whether there are legislative efforts underway to boost direct care pay in the DDS system in order to recruit more caregivers and prevent others from leaving the system.
Neither Sudders nor Ryder has responded to our query.
A staff member of the Children and Families Committee did get back to us last week, saying a bill has been proposed for the second year in a row that would gradually raise the pay of direct care workers employed by DDS providers to the level earned by similar workers employed by the state.
Unlike last session’s bill, which would have raised direct care pay to $20 per hour, no actual hourly payment amount is specified in this year’s bill, H.237. The measure was referred to the Children and Families Committee on March 29. A “tentative” vote on the bill isn’t scheduled by the Committee until this coming fall.
In response to a separate query we sent earlier this month to our membership, a number of family members maintained that staffing shortages exist and have caused problems in their loved ones’ residences. One parent said a DDS regional director had confirmed to her that “there is a staff shortage statewide and they are working to recruit people.”
In one case, a DDS official emailed a parent of a state-operated group home resident, saying DDS was “in touch with (the group home management) …to ensure proper staffing ratios are being met at all times.”
But a number of family members said they did not believe staffing has lately been adequate in the residences. One parent said her son needs two staff to assist him. She said, however, that there were only two staff available per shift in the entire residence, whereas there used to be five staff per shift. The parent termed the staffing situation “potentially dangerous.”
Another parent said several staff in her son’s residence were either on vacation, had resigned, or were in training elsewhere. She said the situation resulted in a recent incident in which a resident of the home left the residence unnoticed and was eventually found outside and brought back by staff.
Affecting quality of care
The parent cited above added that the shortage of staff in the residence has been accompanied by a shortage of hygienic supplies such as disposable wipes and body wash. “The lack of good personal hygiene is neglect,” the parent said.
Use of temporary employment agencies
Two family members said the providers running the group homes were using temporary staffing agencies to fill full-time positions. “They come into the house,” said one parent, “turn on the TV and sit down.” The parent said the temporary staff are not allowed to drive, so her daughter “is stuck inside the house all day, sometimes day after day, which is contributing to her health issues.”
A parent of a resident in a state-run group home said a number of the group home Occupational Therapy and Physical Therapy staff were also working in provider-run homes in order to supplement the staffing there.
Need for higher pay for direct care workers
A number of parents pointed out the connection between the staffing shortages in the group homes and low pay for direct care workers.
As one parent put it in an email to us, “Since the governor has a $4 billion surplus, maybe he could give DDS money,” specifically to increase group home staff wages.
A state budget fund was created a number of years ago, in part, to boost direct care wages. The problem is that while the fund has generated surplus revenues for many providers in recent years, little of the money has apparently gone to boost direct care pay.
In 2018, Governor Baker did sign legislation to raise the minimum wage of direct care and other workers to $15 an hour; but the minimum wage won’t reach that amount until 2023. In 2017, the Legislature rejected efforts to raise direct care wages to $15 as of that year, and rejected a bid in 2019 and again last year to raise direct care wages to $20 per hour.
EOHHS no longer tracking staff vaccinations
Also possibly due to the staffing shortage, the administration is not only not requiring working staff to be vaccinated for COVID-19, the administration is no longer tracking the number of staff who are vaccinated. EOHHS said it has never tracked the number of staff refusing vaccinations.
In a response to a June 28 Public Records Request we submitted for the latest numbers on residents and staff in the DDS system who have been vaccinated, EOHHS said they stopped tracking that information as of April 23. That was the last time they provided that information to us.
On April 23, EOHHS gave us information from early that month, indicating that about 50% of staff in DDS-funded group homes had been vaccinated, and 75% to 90% of residents in group homes had been vaccinated. So apparently with only half of the staff in the system vaccinated, EOHHS decided to stop tracking it.
Perhaps given the fact that the administration doesn’t require DDS staff to get vaccinated, the administration decided it isn’t necessary to know how many staff have actually done so. That seems to be a risky approach.
It also seems one of the administration’s biggest fears has been that the COVID crisis would lead to staffing shortages. As a result, the administration was slow to require testing of staff for COVID-19, and has declined to require that staff get vaccinated.
Despite that fear, the administration and Legislature apparently don’t seem to want to do the one thing that would go furthest to prevent staffing shortages — that is, ensure that direct-care staff are adequately paid for the difficult and important work they do.
Connecticut has moved ahead of Massachusetts on direct-care worker wages
It apparently took the threat of a major strike, but the Connecticut Legislature passed a bill and the Connecticut governor signed it earlier this year to raise the minimum wage of direct-care workers in that state’s Department of Developmental Services system to $14.75 an hour, starting January 1.
A similar effort fell short last year in Massachusetts when a budget amendment to raise direct-care wages to $15 was killed in a budget conference committee in the Massachusetts Legislature.
While Governor Charlie Baker signed separate legislation in June to raise the minimum wage across the board in Massachusetts to $15, that wage level won’t actually be reached until 2023. The minimum wage will rise to only $12 next year, whereas it will be close to $15 in Connecticut for human services workers as of January 1.
It seems that even though legislators and the administration of Governor Dannel Malloy in Connecticut are equally as tolerant of runaway privatization as they are here in Massachusetts, the Connecticut Legislature and governor have shown a greater recognition that increased privatization has resulted in low wages for direct care human service workers, and that low wages have had a negative impact on services.
In May, after the Connecticut Senate voted overwhelmingly in favor of setting the minimum direct-care wage at $14.75, Malloy made a statement that we have yet to hear Governor Baker make:
“For far too long,” Malloy said, “the people who provide care to our most vulnerable neighbors have been underpaid for their critical work.”
In fairness to Baker, Malloy made that statement only after 2,400 employees of nine corporate provider agencies in Connecticut voted in April to authorize a strike that was set to begin in early May. The workers in Connecticut are represented by the SEIU 1199 New England union.
Clearly hoping to avert that strike, the Malloy administration proposed raising the minimum wage for human services workers to $14.75 an hour and providing a five-percent raise for workers earning more than $14.75 an hour effective January 1.
The Malloy administration’s proposal, which was endorsed by the SEIU union and ultimately signed into law, applies to 19,000 union and non-union caregivers that staff some 170 group homes and other nonprofit agencies that receive Medicaid funding in Connecticut, according to The Connecticut Mirror.
As Connecticut Senate President Pro Tempore Martin Looney noted:
The work (those caregivers) do is among the most important in our state in terms of humanity. If we are to consider ourselves a humane and caring society, at long last we should begin at least to recognize the value of that work.
In Massachusetts, SEIU Local 509 helped organize a five-day strike for a living wage in July at CLASS, Inc., a DDS-funded day program provider based in Lawrence. The workers there were getting paid about $13 an hour and wanted a $1 increase. The company was offering an increase of only 40 cents.
The president of CLASS, meanwhile, was making about $187,500 a year, according to the state’s online UFR database.
In July, workers at CLASS, Inc. reached a settlement with management to raise the workers’ wages by 60 cents an hour. That would still leave the average worker there well below what direct-care workers will be earning in Connecticut.
The Massachusetts strike, moreover, didn’t have the impact on legislators and other policy makers here that the threat of the Connecticut strike apparently did in that state. Thus far, it isn’t apparent that there is any political will in Massachusetts to raise the minimum wage of direct-care workers to Connecticut’s level.
That is concerning because five years is a long time to wait for the minimum wage for direct-care workers to reach $15. Due to inflation alone, that $15 will be worth less to Massachusetts workers in 2023 than it would be if they were to receive it starting this January.
DDS vendor executives not sharing the pain of their workers
Direct-care workers in the state’s contracted human services system have seen their wages stagnate in recent years, but the executives who run the largely nonprofit contractor agencies that employ those workers do not appear to have been feeling that same pain.
We examined compensation to both CEOs and direct-care workers in a sample of 30 service vendors to the Department of Developmental Services, both large and small, from around the state in Fiscal Years 2008 and 2011. This information is available in Uniform Financial Reports, which are submitted to the state Operational Services Division by the vendors and are posted online by the OSD at www.mass.gov/ufr.
The CEO compensation of our sample increased by an average of 16.6 percent during the four year period while the direct-care salaries decreased by an average of 2.17 percent during that time. (See Vendor Compensation Table.)
Among the 30 vendors, the average CEO compensation in FY 08 was $197,068. It increased to an average of $229,872 in FY 11. In FY 08, the average direct care salary for the sample was $33,508. It decreased to $32,780 in FY 11. In FY 11, direct-care workers were earning an average of 14 percent of what the CEOs of those vendors were earning, down from 17 percent in FY 08.
Among the sample, nine CEOs received compensation increases in the four year period reviewed while the direct care workers employed by those same vendors actually saw their wages cut. In two of those cases, the CEOs received increases exceeding 100 percent.
That many CEOs have taken hefty pay increases and the direct-care workers have gotten little or nothing, or in many cases decreases, raises questions about repeated calls from the vendors to add $28 million to a state budget reserve fund to increase those direct care salaries.
If the Association of Developmental Disabilities Providers and its member vendors are really concerned about their direct-care workers’ pay, why have these companies given raises only to their CEOs? Should the state be called upon to bear the entire burden of raising direct-care wages?
“The vendors appear to have it in their own power to give their direct-care workers increases, but they’ve chosen not to,” said Colleen Lutkevich, COFAR executive director. “Instead, they’re looking to the Legislature.”
If the Legislature does step in to fund the direct-care salary reserve account, it will not be at the urging of Governor Patrick. Despite the ADDP’s appeals, the governor’s budget for the coming fiscal year proposes zero for the reserve fund.
Note: We were not able to use data from one of the vendors, Massachusetts Mentor, Inc. Massachusetts Mentor is a subsidiary of NMH Holdings, Inc., a for-profit corporation that provides residential and other services for intellectually disabled persons in 36 states. NMH Holdings was incorported in Delaware, according to its audited financial statements, though it actually appears to be headquartered in Massachusetts. (NMH Holdings appears to be referred to as The Mentor Network on its national website.)
Massachusetts Mentor’s UFR and other reports filed with the state OSD employ what appears to be an unusual method of listing only partial salaries of top executives. The compensation listed is apparently the amounts of the executives’ salaries that are attributed to Massachusetts. For instance, total compensation for Edward Murphy, CEO of both Mass. Mentor and The (national) Mentor Network, was listed as only $14,830 in FY 10, in a filing with OSD). (The company does not appear to have filed a UFR report in Massachusetts for FY 11.) Murphy is a former commissioner of both Mental Health and Youth Services in Massachusetts.
Greg Torres, chairman of the Board of Directors for both Mass. Mentor and The Mentor Network, earned a total of $2,484 in compensation in FY 10, according to the OSD filing. Torres, a former chief of staff of the Massachusetts Senate Ways and Means Committee, is also currently president of MassINC, the nonprofit civic think tank in Massachusetts that publishes CommonWealth magazine. (CommonWealth frequently advocates for more transparency in governmental finances and operations.)
Also working for Mass. Mentor is Gerald Morrissey, a former commissioner of DDS in Massachusetts. Morrissey’s total compensation as a vice president at Mass. Mentor was listed in the FY 10 OSD filing as $5,113. None of these clearly partial compensation listings could be reliably compared with other CEO and direct-care compensation in Massachusetts.
NMH Holdings earned more than $1 billion in revenues in FY 10, according to filings with OSD, while Massachusetts Mentor took in $3.7 million from DDS and $19.4 million from the Department of Social Services in FY 10, according to its UFR report.
Calls and emails to OSD with questions about Mass. Mentor’s and NMH Holdings’ partial compensation listings for their executives were not returned.
COFAR blog 