New York City’s Biggest Job Engine Has Become a ‘Racket,’ Hochul Says

(Bloomberg) — “Get paid to care for your loved ones,” the subway ad for one of New York’s Medicaid-funded home health aide programs says.

But the statewide benefit, which pays people to care for their family members and friends, is being exploited and becoming a “racket,” according to Governor Kathy Hochul.

The consumer directed personal assistance program, known as CDPAP, is paid for largely through the state’s Medicaid system. It has helped drive the majority of New York City’s job growth over the past year.

Budget officials published documents in April showing that almost all of the jobs added in the city in the 12 months ended March were in the home-health industry. Without those gains, the city’s total private sector jobs would have contracted over the year.

The program “has become one of the most abused programs in the entire history of the state of New York,” Hochul said Thursday in an interview with Bloomberg News.

“I’m telling you right now, when you look on TikTok and you see ads of young people saying, ‘Guess what, you can make $37 an hour by sitting home with your Grandma. You know, here’s how you sign up,’ — it has become a racket,” she said. 

CDPAP’s enrollment, workforce and total costs ballooned after the state relaxed eligibility rules in 2015. The number of people receiving care through the program surged from just under 20,000 in 2016 to almost 248,000 last year. New York state Medicaid spending on CDPAP in the last five years has more than tripled to about $9.1 billion. 

New York needs to make changes to the program, which Hochul called “wildly expensive.”

Jobs in home health make up an increasingly large share of the city and state’s overall economy. Between 2014 and 2024, home health aide jobs went from comprising 6% of New York City’s total private-sector jobs to 12%, according to Bill Hammond, the senior fellow for health policy at the Empire Center for Public Policy, a fiscally conservative think tank.

A commission Hochul convened is scheduled to recommend changes in the state’s health care system by the end of this year. Hochul said she hopes that will allow the state to start implementing, or at least talking about, making some real changes for next year” in the home health aide program. 

“Something has to give here,” she said.

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