I. Introduction

The COVID-19 pandemic has made many Americans rethink how we care for our loved ones as they age or live with a disability. As the pandemic devastated nursing homes and other in-patient care settings, many began wondering, is this our best option?

For millions of Americans who live with a disability or need extra help, the answer has long been “no.” Decades of advocacy have helped to keep people in the community and out of institutional care settings. This shift is improving care and reducing costs for consumers.

The home care workforce has made these gains possible. Home care workers help older adults and people living with disabilities to remain in their homes and in their communities. This is difficult, skilled labor involving intimate support from birth through end of life care.

Yet, home care workers suffer some of the greatest job instability, driven by low wages, a lack of benefits, and fluctuating work hours that make pay unpredictable. These hardships fall disproportionately on women, people of color, and immigrants who comprise the vast majority of the home care workforce. From an equity perspective, it is imperative that these workers get the compensation they deserve.

Demand for home care is high and growing: the Bureau of Labor Statistics estimates that home care will have the highest number of openings in the next decade. The United States is projected to have over 80 million people aged 65 and older by 2040, and an estimated 70 percent of people who reach age 65 will need long-term care. However, need is already outpacing available services: today, over 600,000 people are waitlisted for home care because states don’t have enough in their budgets to meet demand.

The American Rescue Plan Act (ARPA) of 2021 signaled a commitment to make a meaningful investment in home care. This report provides a state-by-state analysis of how much ARPA funding went to each state and how states are using this funding. We also provide excerpts from qualitative interviews with home care workers, a client, and a state administrator. These interviews illustrate how federal funding impacts home care workers and underscore the urgent need for additional investments.

Based on the early experiences across states, we recommend the following policy design changes to help investments reach workers faster and address consumer needs: States should consider (1) adopting higher base wages rather than passing funding to home care agencies through higher reimbursement rates; (2) Making wage increases permanent; and (3) adopting family care programs to ensure family caregivers (who care for people in their own household) are eligible for home care wages.