Washington, D.C. – Last week, more than 100 economists and public policy experts sent an open letter urging Congress to make a robust investment in home and community-based services as part of the Build Back Better Budget. The group recommended that Congress allocate a minimum of $250 billion to expand home care services, noting that such an investment would create jobs and respond to the overwhelming desire from most seniors and people with disabilities who would prefer to receive care at home. In June, U.S. Senator Bob Casey (D-PA), Chair of the Senate Aging Committee, introduced the Better Care Better Jobs Act, which would provide a bold investment to expand access to home and community-based services for seniors and people with disabilities, support family caregivers and lift up the home care workforce.
“The consensus among economists, public policy experts, caregivers, families, seniors and people with disabilities is clear – a substantial investment in home and community-based services is urgently needed. The Better Care Better Jobs Act is essential to strengthening our economy and enhancing access to quality, cost-effective care for American families. I will continue to fight for full funding for home and community-based services in the Build Back Better Budget,” said Senator Casey.
Read the full letter here.
An Open Letter from Economists and Public Policy Scholars in Support of Investments in Home and Community Based Services
We, the undersigned, agree that robust investments in home and community based services must be a part of any major economic legislation. Access to care services are a foundational part of our national infrastructure, and Congress should allocate a minimum of $250 billion in the reconciliation package to the home and community based services (HCBS) program.
Every day, 10,000 people turn 65, and by 2060, 94.7 million Americans will be 65 or older. Seventy percent of people over the age of 65 will require long-term care at some point in their lives. As a result, the caregiving workforce will need to grow significantly in order to keep up with demand. Most Americans would prefer to receive care at home rather than a nursing home: not only do they experience better outcomes, but the monthly median cost of a home health aide is $4,576, compared to $7,756 for a semi-private room in a nursing home. However, today, over 820,000 people are on waitlists for services, potentially resulting in unnecessary nursing home placements, heavy burdens placed on families, or seniors going without needed care. At the same time, 2.4 million essential home care workers are paid on average $12 an hour, and up to 18%--one in six home care workers--live in poverty, contributing to high turnover and worker shortages.
Investing in home care makes economic sense: it will create jobs, seniors and their families prefer it, it will reduce spending by shifting people out of nursing homes, and improve care outcomes. Research has also shown that elder care reduces the labor supply of care-givers. As a result of these effects, a recent analysis from Moody’s analytics found that investing in home and community based services has a near-term benefit in the economic recovery with an economic multiplier greater than one, meaning that every dollar spent boosts the recovery by more than a dollar. Longer-term, the analysis estimates higher economic growth by boosting the employment of family caregivers.
This Investment Will Create Jobs and Opportunity for Those Currently Carrying the Burden of Care
This historic investment in HCBS will strengthen the economy, both by creating jobs and by allowing people who are currently providing unpaid care to loved ones the support they need to rejoin the labor force. An analysis of the Senate bill found that expanding HCBS eligibility to allow an additional 3.2 million low-income seniors and people with disabilities would create 500,000 new and essential positions to provide home-care and allow 1.1 million unpaid caregivers to return to work.
Even as home care is quickly growing into one of the largest occupations, there are even more family caregivers providing care to the elderly and people with disabilities. There are almost 20 million informal caregivers to people over 65, and they are disproportionately women, most often spouses and daughters. Without support, caregiving can have negative effects on caregivers’ physical and mental health, as well as limiting caregivers’ ability to remain in the workforce, while public investment can actually improve caregiver mental health and boost female labor force participation. Recently, the US has seen female labor force participation stagnate relative to many other developed countries. By alleviating caregiving burdens, one of the key constraints to women’s workforce participation, investing in home care will help the US maintain a competitive workforce.
This Investment Will Improve the Quality of Care
COVID-19 has exposed the dangers of underinvestment in our long-term care system. A robust, well-trained home care workforce is essential to protecting seniors and allowing them to live healthy lives. Currently, wages and benefits for home care workers are extremely low--many home care workers live in poverty and do not have health insurance, despite the essential and important service they perform. These low wages mean that workers often have to work multiple jobs, are likely to burn out, and firms have difficulty hiring and retaining workers, leading to more underinvestment. Increasing funding will allow higher pay for home care workers, while making it still more affordable than institutional options, while reducing turnover and absenteeism, and increasing the availability of workers. At current rates, some patients who are physically able to receive care at home end up in nursing homes because they are unable to find consistent home care. Research from nursing homes has found that increasing wages for direct care workers improves health outcomes for patients. The same is likely to be true in the case of home care.
Lawrence Katz, Harvard University
Heidi Shierholz, Economic Policy Institute
Betsey Stevenson, University of Michigan
Cecilia Muñoz, New America
David Cutler, Harvard University
Jonathan Gruber, MIT
Richard Frank, The Brookings Institution
Jesse Rothstein, University of California, Berkeley
Emmanuel Saez, University of California Berkeley
Gabriel Zucman, University of California, Berkeley
Carol Zabin, University of California, Berkeley
Peter Q. Blair, Harvard University (GSE)
David Autor, MIT Department of Economics
Claire Montialoux, University of California, Berkeley
Luke Tate, Arizona State University
Sonal Shah, Georgetown University
Jacob S. Hacker, Yale University
Michael Hout, New York University
Anne-Marie Slaughter, New America
Melody C, Barnes, The Miller Center, University of Virginia School of Law
Laura Dresser, University of Wisconsin
Heidi Hartmann, American University
Thomas L Hungerford, National Academy of Social Insurance
Kristin Smith, Dartmouth College
Ruth Milkman, City University of New York, Graduate Center
Nicolas Robert Ziebarth, Cornell University
Trevon D Logan, The Ohio State University
Michael Reich, University of California, Berkeley
Catherine Maclean, Temple University
James P. Ziliak, University of Kentucky
Tara D. McGuinness, Georgetown University
Juliana Londono-Velez, University of California, Los Angeles
Daniel Tannenbaum, University of Nebraska - Lincoln
Susan Lambert, University of Chicago
Andreas Mueller, The University of Texas at Austin
Anna Stansbury, MIT Sloan
Stephen J. Rose, George Washington University
Maria S. Floro, American University
Nancy Folbre, University of Massachusetts Amherst
Jeannette Wicks-Lim, University of Massachusetts, Amherst
Sean F. Reardon, Stanford University
Mary C. King, Portland State University
C Matthew Snipp, Stanford University
David B. Grusky, Stanford University
John Schmitt, Economic Policy Institute
Indivar Dutta-Gupta, Georgetown Center on Poverty and Inequality
C. Nicole Mason, Institute for Women’s Policy Research
Jennifer Cohen, Miami University
Shirin Arslan, American University
Randy Albelda, University of Massachusetts Boston
Daniel Carpenter, Harvard University
Scott W. Allard, University of Washington
Priyanka Anand, George Mason University
Lenore Palladino, University of Massachusetts Amherst
Molly D. Dillon, Obama White House Domestic Policy Council
Lily Roberts, Center for American Progress
Andres Vinelli, Center for American Progress
Jocelyn Frye, Center for American Progress
Ben Zipperer, Economic Policy Institute
Robert A. Blecker, American University
Rene P. Rosenbaum, Michigan State University
Chris Tilly, University of California, Los Angeles
Ebru Kongar, Dickinson College
Manuel Pastor, University of Southern California Equity Research Institute
Annette Bernhardt, University of California Berkeley Labor Center
Tynan Challenor, University of California Berkeley Labor Center
Pamela Loprest, Urban Institute
Michael Ash, University of Massachusetts Amherst
Lisa M. Lynch, Brandeis University
Jennifer Sherer, Economic Policy Institute
Dave Kamper, Economic Policy Institute
Henry M. Levin, Teachers College, Columbia University
Monique Morrissey, Economic Policy Institute
Robert M Anderson, University of California, Berkeley
Prasannan Parthasarathi, Boston College
Tracy Mott, University of Denver
Candace Howes, Connecticut College
Teresa Ghilarducci, The New School
Christian E. Weller, McCormack Graduate School, University of Massachusetts Boston
Ken Jacobs, University of California, Berkeley Labor Center
Enrique Lopezlira, University of California, Berkeley Labor Center
Pamela Egan, University of California, Berkeley Labor Center
Nari Rhee, University of California, Berkeley
Peter Hans Matthews, Middlebury College
Yavuz Yasar, University of Denver
Alan A. Aja, Brooklyn College (CUNY)
Richard Walker, University of California, Berkeley
Adam S. Hersh, Economic Policy Institute
John Miller, Wheaton College
John Melcher, Michigan State University
Jodi M. Sturgeon, PHI
Karen Shen, Research Improving People's Lives
Stephen E. Baldwin, Ph.D., Retired, Bethesda, MD
David Grabowski, Harvard Medical School
David Wilkinson, Tobin Center for Economic Policy at Yale
Amanda R. Kreider, Leonard Davis Institute of Health Economics, University of Pennsylvania
Martha J. Bailey, University of California, Los Angeles
Jeffrey S. Crowley, O'Neill Institute/Georgetown Law
Rachel M. Werner, University of Pennsylvania
Courtney Harold Van Houtven, Duke University School of Medicine
