Position Statement

In recent years, Michigan’s budget discussions have centered on significant funding for future economic development projects such as SOAR. However, we can’t afford such luxuries while we keep overlooking the immediate crisis facing our existing workforce.

It’s crucial that lawmakers address the financial needs of our state’s Direct Care Workers (DCWs), who are essential in supporting individuals with developmental and behavioral disabilities.

More than 50,000 Direct Care Workers in Michigan’s behavioral health system provide daily support and independence to people with disabilities. However, DCW wages are tied to Medicaid funding, which hasn’t kept up with the state’s needs. As a result, many DCWs earn very low wages and often lack the most basic benefits, like health insurance.

Because of this, many DCWs are leaving their jobs for better-paying positions that offer more support for themselves and their families. Currently, there is a 38% turnover in the field, which puts additional pressure on those trying to live and work within a system that pays an average starting wage of just $16 per hour.

Before we spend billions on faceless corporations, we must ensure the wellbeing of our most vulnerable residents by supporting those who help them live safe, independent lives.

Right now, Michigan’s behavioral health system continues to collapse, creating a real—and worsening—state of emergency for people whose needs are greatest:

• Chronic or extended hospitalizations (we’re talking months, not weeks),
• Reliance on aging parents for ongoing care and, most important of all,
• Providers are starting to withdraw services due to the lack of sufficient reimbursements

In short, Michigan now faces a costly—and dangerous— provider network adequacy issue.

During the past three years, the Legislature has been working to increase DCW compensation, and we are grateful for its efforts. However, long-term, consistent supports for caregivers is now decades overdue.

In the past, we’ve asked for DCW pay increases to ensure safety and independence for the people they serve. But while that is an essential part of the equation, it’s not going to solve the entire problem.

Find Administrative Efficiencies within the Medicaid Wage Pass-Through Model 

Michigan DCWs are typically paid through multiple sources: federal Medicaid dollars, state general fund money and any available local funds.

One hundred percent of all state GF and local funds reach DCWs in Michigan. Generally speaking, the federal Medicaid funds, which make up most of the money available to pay DCWs, are handled through a wage pass-through system. Medicaid funds are distributed by the federal government, which are then allocated by the state. The funds make a stop inside MDHHS, which then allocates a portion to the state’s pre-paid inpatient health plans (PIHPs). From there, the dollars go on to local community mental health agencies for distribution to DCWs. At each level, portions of the funds are removed to compensate these agencies for the administrative work associated with distribution and reporting. 

Boost DCW Compensation

Michigan must increase its GF allocation to the state’s 50,000 DCWs in the behavioral health system by $4.00 per hour.

·       Direct supervisors also must receive wage increases that are commensurate to the compensation of the individuals that report to them.

·       DCWs should receive health care benefits and paid time off, as well as a supportive work environment.

·       Rates for DCWs working in other sectors are increasing, but behavioral health is being left behind.

The total cost of the change in the behavioral health sector will be $287 million.

Simplify Administration

Streamline and standardize reporting and documentation requirements, particularly with respect to Electronic Visit Verification and progress notes. This outcome will help the remaining pool of available DCWs to provide supports more effectively, including higher levels of service, rather than unnecessarily spending time on paperwork.

Elevate the DCW Profession

Work to boost opportunity and growth within the DCW profession by investing in other critical aspects of the field, including:

·       Accessible, competency-based training

·       Tiered certification promoting a career pathway

·       Consistent, portable, recognized credentials

·       Professional associations

·       Ethical standards

·       Research and innovation

·       Mentorship and leadership development

·       Advocacy and public awareness

·       Recognition and awards

·       Stakeholder collaboration

·       Diversity and inclusion

·       Continuous improvement

Partner with Local Economic and Workforce Agencies

Build better routes to DCW jobs and use data about the availability of local DCWs as a selling point for communities looking to attract new jobs and employers. By showing that it’s possible for people with disabilities to live a full life in Michigan, we can make our state stronger and make economic development a priority.

·       Build linkages with Michigan Works! agencies statewide as part of an effort to elevate the DCW profession.

·       Seek opportunities to collaborate with economic and business attraction efforts.

Action is needed NOW. Support Michigan’s Direct Care Workers.

View the Direct Care Worker Wage Coalition Position Statement.

View the Direct Care Worker Wage Coalition Leadership Briefing.

Learn more about the Direct Care Worker Wage Coalition at https://www.dcwmichigan.org/