Home Care Overtime Decision Leaves $200 Million Question Mark in State Budget

Last week’s decision by the state to drop a plan to pay home health workers overtime wages has left a gap in the governor’s budget proposal.

U.S. District Court Judge Richard Leon ruled on Wednesday last week that only Congress has the authority to award extra pay to home care workers. The following day, California officials announced they were dropping the state’s planned overtime rule.

That means there now is an extra $200 million sitting in the governor’s proposed budget, a sum that’s expected to grow to $300 million in next year’s 2016-17 budget plan.  

“It’s a pretty big-ticket item. That’s almost $200 million general fund this year, and another $300 million the year after that,” said Marty Omoto, executive director of California Disability Community Action Network, an advocacy group for the disabled.

“That money is pretty important,” he said. “You can’t let that kind of money stay on the table like that. Unclaimed.”

Advocacy groups have certainly noticed that money, Omoto said.

“[State officials] have said they plan to keep it in the system, but they weren’t specific on that,” Omoto said. “So far, I’ve heard nothing concrete yet from the Legislature. So unless someone gets in there and claims it, other people are going to be looking at that, definitely. I would be.”

Union officials have said they will pursue some kind of legislation in budget negotiations to corral that money for home care worker overtime pay, even though it now is not required by federal law, given last week’s court decision.

The home health care overtime money is separate from the roughly $400 million set aside in the budget for restoration of a 7% cut in hours for the In-Home Supportive Services program. That provision is unaffected by the court ruling.

“I think advocates and the unions will push for some type of state law to allow for overtime,” Omoto said. “I think that’s part of the deal for June. It was meant to be part of the budget already.”

That could be a little tricky, though, if the Legislature also wants to put other health care budget items into the queue, such as coverage for the undocumented, a cost of living increase in SSI funding or some kind of remedy for the Medi-Cal provider reimbursement rate cut.

“It’s a big hanging question mark about overtime,” Omoto said. “Until that gets resolved, a lot of other things have to be put on hold.”

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