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5 Percent Campaign legislation grows to a 7 percent

The 5 Percent Campaign returned Tuesday, growing significantly in scope.

The campaign aims to increase by 5 percent the wages of workers who care for elderly and disabled Minnesotans, similar to a bump given to nursing home workers in 2013.

Rep. Rod Hamilton (R-Mountain Lake) sponsors HF564, which was laid over by the House Health and Human Services Finance Committee. Its companion, SF646, sponsored by Sen. Kent Eken (DFL-Twin Valley), awaits action by the Senate Finance Committee.

The bill, as presented in committee, would increase state reimbursements by 5 percent for home and community-care providers and require 90 percent of the funds be dedicated to wages.

Adopted amendments increased the bill’s target to a 7 percent reimbursement rate that included new items. Here’s the breakdown:

  • a 5 percent state reimbursement increase for providers, with 100 percent of funds dedicated to compensation;
  • a 1 percent reimbursement increase for improving quality of care; and
  • a 1 percent reimbursement increase for improving person-centered care.

The Department of Health would also be required to develop a plan, along with cost estimates, of what would be required to increase direct care worker compensation to $15 per hour by July 2019.

Rep. Diane Loeffler (DFL-Mpls) said she plans to introduce legislation to finance a $15 per hour plan in the near future.

Supporters argued increasing wages for home and community-based providers would address high turnover rates and help address the 8,700 vacancies in care worker and staff positions across the state. They argued providers only being able to offer an average of $11 per hour due to state reimbursement rates make it difficult to attract and retain quality workers.

The fiscal note for the 5 percent version of the bill estimates it would cost $95 million for Fiscal Year 2017 and $232 million for the 2018-19 biennium. Cost estimates for the new version of the bill are not yet available. 

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