Biden’s Build Back Better Act Steers Billions Of Medicaid Dollars To Labor Unions

By Maxford Nelsen for RealClearHealth

Amid the fast-paced congressional talks over President Joe Biden’s budget-busting “Build Back Better Act” (BBBA), the legislation’s massive expansion of federal Medicaid funding for in-home care has thus far received little scrutiny.

The legislation was cynically designed to divert potentially billions in Medicaid dollars to labor organizations, forcing thousands upon thousands of home-care aides to support far-left politics and burdening taxpayers with wasteful programs.

Medicaid was established in 1965 to pay Medicaid for long-term services. Recent decades have seen a shift towards providing such services in the client’s home, a model which minimizes costs and maximizes the client’s independence compared to institutionalized settings.

Union organizing began in the 1990s when home-care aides for Medicaid clients were targeted. Hundreds of thousands in Medicaid-paid caregivers are unionized in at least 8 states, generating approximately $150 million in dues to unions such as SEIU or AFSCME alone in 2017.

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Many of these caregivers have a close relationship to the clients they serve. They work from home, often with their clients. As such caregivers do not receive traditional workplace representation through their unions, even though they pay up to $1,000 annually in dues.

The 2014 ruling by the U.S. Supreme Court was in Harris v. Quinn that the First Amendment protects “quasi-public employees,” like Medicaid caregivers contracting directly with the state, from being required to pay union dues.

Unions have attempted to avoid the rule at all costs since then.

In 2018, Washington state lawmakers adopted union-backed legislation to privatize the home care workforce, transforming caregivers from “quasi-public employees” to employees of a private company who, in Washington and 22 other states lacking right-to-work protections, could be forced to pay union fees.

The legislation was strongly opposed by caregivers, but it did not work. As one mom fighting SEIU to preserve her rights put it, “They’re so huge. They’re so big… How are we going to go up against a giant like that?”

If the BBBA becomes law, hundreds of thousands of caregivers might be asked the same question.

Following Washington’s ignoble example, the legislation conditions an increase in Medicaid funds on states’ adopting an “agency with choice” model for their HCBS programs, precisely the arrangement put in place by Washington lawmakers to circumvent Harris.

Though legally permissible, the Department of Health and Human Services under both the Obama and Trump administrations promoted different arrangements that, by avoiding a middleman employer between clients and their caregivers, offer clients greater “flexibility and empowerment.”

That appears to matter little to the BBBA’s backers.

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While the legislation’s advocates generally content themselves with generic messaging about caring for seniors and the disabled, at least Rep. Robin Kelly (D-IL) had the temerity to acknowledge the BBBA would boost “organizations like SEIU.”

Unfortunately, the BBBA also seeks to propagate Washington’s union-dominated home care model by paying union affiliates to run training and other programs for caregivers. Washington’s experience shows these programs are plagued by cronyism, waste, and a lack of accountability.

To administer the nation’s most difficult training program for home-care aides, the state funds a SEIU affiliated nonprofit. The state provides SEIU membership opportunities and spends less training than it receives, resulting in steady increasing assets.

Despite receiving hundreds of millions of Medicaid dollars, Washington’s Democrat state auditor has documented how the training discourages recruitment and has failed to solve high turnover. Although the auditor speculated that decreasing training requirements would increase recruitment, the auditor did not offer any formal recommendations. No data is available to prove the effectiveness of client care training.

A similarly-structured, Medicaid-funded, and union-operated, trust for caregivers in health benefits has amassed assets many times higher than what its own consultants recommended. This is simply because it could.

Through Medicaid, Washington pays another SEIU affiliate to help connect clients seeking care to caregivers looking for work — a function the state already performs.

The four-year-old process of establishing modest caregiver benefits from a Medicaid-funded, union-operated retirement plan cost $110 million.

Furthermore, they pay millions of dollars to their local SEIU affiliate, which is supposedly for administrative support. All told, about three percent of Washington’s payroll costs for caregivers wind up going to SEIU.

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By seeking to replicate Washington state’s model around the country, the BBBA has the potential to steer billions of dollars in Medicaid funds into the treasuries of unions with few obligations to their members but a comprehensive political agenda.

There’s simply no excuse for allowing unions to rig Medicaid for their own enrichment at the expense of caregivers, Medicaid beneficiaries and taxpayers alike. States should have access to any additional HCBS funding Congress may approve without strings attached.

Maxford Nelsen, the Freedom Foundation’s director of labor policy, is based in Olympia (Wash.) and has been around for 30 years. The Freedom Foundation promotes individual liberty, freedom, enterprise, limited government, accountability, and personal responsibility.

RealClearWire permission granted this syndicated version.

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