+50 Workers, Consumers, & Legislators Demand State Stop Multibillion Dollar Giveaway to Private Insurers

February 1, 2024

Speakers called on Governor Hochul to end hugely wasteful program that diverts billions in taxpayer money meant for vulnerable New Yorkers into the pockets of for-profit insurance companies

Home Care Savings & Reinvestment Act would cut out wasteful middle-men and save State $3 billion/year

Over fifty home care workers and consumers from around the state joined State Senator Gustavo Rivera, Assemblymember Amy Paulin, State Senator Cordell Cleare, and other legislators in Albany to urge support for legislation that would stop the state from giving billions to private insurance companies meant to provide home care for older and disabled New Yorkers and return home care management to the state.

"Ensuring affordable and quality long term care for our aging and differently abled populations should be one of the cornerstones of our healthcare delivery system, especially with the rising costs of these services. Privatizing health care has not saved our state money or improved care for New Yorkers, instead it enriches private health insurance companies. I am proud to sponsor this bill because by removing the middle man, we will modernize our healthcare system to ensure dollars are going to home care providers and not being siphoned off." said State Senator Gustavo Rivera, Chair of the Senate Health Committee. 

“New York is facing a severe home care shortage that is getting worse year after year. One way to address it is to invest in home care and increase home care workers’ wages. I'm proud to sponsor the Home Care Savings & Reinvestment Act which will generate annual savings to help pay for growing home care needs, improving service quality, and ensuring continuity of care. I hope that we’ll take this important step to help New York’s home care worker shortage,” said Assemblymember Amy Paulin, Chair of the Assembly Health Committee.

“As Chair of the Senate Aging Committee, I am a proud co-sponsor of the Home Care Savings and Reinvestment Act. This legislation has the power and scope to cut through all the greed, red-tape and mismanagement that accompanied the decision to privatize the administration of Home Care Services in 2011. In doing so, we will save billions of dollars, increase the quality of care to patients and the quality of life for home care workers,” said State Senator Cordell Cleare, Chair, Committee on Aging.

New York transitioned home care from a traditional “fee-for-service” model to a Medicaid Managed Care Program (“MLTC”) in 2011, arguing that privatization would save money and improve care through the use of care management. Instead of generating the promised cost savings while improving home care quality, private for-profit corporations have pocketed billions while worsening the home care crisis for countless older adults and disabled New Yorkers across the state.

The Home Care Savings & Reinvestment Act (S7800/A8470) would stop the state from giving insurance companies billions of dollars by removing these ineffective middlemen and finally realizing the promise of care coordination and care management, while taking home care management out of the hands of profit-driven intermediaries. This legislation will generate $3 billion in savings annually, which could be used to pay for growing home care needs, improve service quality, and ensure continuity of care by funding higher wages for home care workers to help resolve New York’s worst-in-the-nation home care worker shortage.

“I love being a caregiver, and that’s why I do this work, but home care workers often live paycheck to paycheck. And while workers like me struggle, the state has been giving billions in taxpayer money to for profit insurance companies—and the governor is now proposing slashing wages too. New York must remove these greedy middlemen, and allow caregivers like me to earn a living wage while providing quality care to clients in their own homes,” said Alice Barnett, a 1199SEIU member who is a home health worker in the Bronx.

Governor Hochul wants to slash tens of thousands of home care workers’ wages by over $3 per hour. The governor’s budget repeals wage parity for Consumer-Directed Personal Assistance Program (CDPAP) personal assistants. In an industry where workers are already dealing with issues of low wages, a cut like this will increase the shortage of workers and force consumers into nursing homes.

“I had a nurse visit my house and approve me for 40 hours. The insurance company slashed it to 20 hours for no reason. There is nobody to call. They replaced my lead care manager at least three times a month. There is at least 45 minutes of waiting on hold to speak to anyone. So this concept that private insurance is more efficient is a lie. I know my life is worth more than a profit line,” said Sage Jobsis, a home care consumer from Rosendale.

"Countless New Yorkers tirelessly dedicate themselves to caring for their loved ones daily yet remain uncompensated. Over 75% of caregivers in the United States attending to adults over 50 are women. Often, their commitment equals or surpasses the hours of a full-time job. The urgency for a revamped healthcare system is undeniable, and New York is ready to spearhead this transformation. As an Assemblyman and a staunch co-sponsor of the Homecare Savings & Reinvestment Act, I am committed to fostering equity in our healthcare system and providing direct support to our invaluable caregivers,” said Assemblymember Eddie Gibbs.

The legislation will generate approximately $3 billion in savings annually, which could be used to pay for growing home care needs, improve service quality, and ensure continuity of care by funding higher wages for home care workers during New York’s worst-in-the-nation home care worker shortage

"The Managed Long Term Care program created in 2011 gave insurance companies control of our home care programs, increasing costs without necessarily improving the quality of care or wage conditions for care providers. It’s time to reinvest to benefit everyone. The Home Care Savings & Reinvestment Act would ensure uniform long-term care benefits for residents in all communities in New York, address workforce issues by improving conditions for those in this field while attracting new care professionals, all at a reduction in cost to the state. We have a responsibility to those who receive and provide care, and now is the time to make this change,” said Assemblymember Sarah Clark. 

“For more than a decade, private insurance companies have operated as a middleman in the state’s Medicaid home care program market under the promise of better quality of care at efficient costs,” said Assemblyman Angelo Santabarbara. “Instead, New York’s home care services are in turmoil, with the state facing the worst labor shortage in the industry nationwide. It’s time the state takes back control of its Medicaid home care program, which is why I’m supporting the Home Care Savings & Reinvestment Act. This legislation can save us billions of dollars annually, which can be invested into improving care and providing better wages for home care workers.

"The state must stop diverting billions of dollars of taxpayer money to for-profit insurance companies while vulnerable New Yorkers wait for desperately needed home care that isn't coming. We have to stop wasting money on ineffective middlemen and ensure that we use funds to pay for home care itself and address the worst in the nation staffing shortage. New York cannot keep turning its backs on vulnerable seniors and people with serious health needs. I stand with my colleagues and advocates in calling for the swift passage of the Home Care Savings and Reinvestment Act," said Assemblymember Jo Anne Simon. 


In the past 3.75 years, New York State has given $5.5 billion to the 24 private insurance companies “managing” home care in administrative costs and profit:

$3.1 billion on administrative costs
  $2.4 billion in profit
 In 2021 alone, the latest full year of data available, private insurance companies pocketed $722 million in profits — this profit margin of 5.5% was twice the national average

The Home Care Savings & Reinvestment Act would:

•  Save New York State approximately $32 billion over ten years
Stop private insurance companies from acting as private intermediaries between the state and home care agencies & workers
•  Stop private insurance companies from pocketing billions annually in funding meant for the home care sector
•  Over 4.6 million New Yorkers will be over age 65 by 2035 — an increase of 29% in the next decade — and nearly 1 million New Yorkers will require home care by 2035. 
New York already faces the worst home care workforce shortage in the nation — and without adequate wages, the home care worker shortage will hit 1.47 million workers by 2035.
  Nearly 20% of state home care positions are unfilled and 42% of agencies reported high turnover. New York's home care workforce is 91% female and 77% people of color.