By Rob Roper
With just a couple of weeks left in the 2019 legislative session advocates for the $15 minimum wage were somehow surprised by the reality that, if they pass this, more revenue will be necessary to pay state funded health care workers. One estimate, likely low, says that figure will be $30 million over five years.
The situation is this: many health care workers who are employed by public/private partnerships and dependent upon Medicaid funds for their salaries currently earn less than $15 an hour, with jobs starting around the current minimum wage of just under $11 an hour. If the mandated wage increase goes into effect, but no money is allocated through Medicaid to make up the difference, the only option is to lay off workers and cut services. As a VPR article states, this is “a simple math problem.”
However, as that article also notes, “… so far at least, lawmakers have yet to make any long-term commitments to assure that the increased Medicaid funding will materialize…. Late last month, the House Committee on General, Housing and Military Affairs attached an amendment that would allocate $875,000 in Medicaid funding to offset payroll increases in year one of the phase-in. Waterbury Rep. Tom Stevens, the Democrat who chairs that committee, said even that money could be difficult to find in the budget — “and we’re not sure it’s there,” he said.
In this scenario, the state is the customer and the Home Health Services are the businesses. If the customer isn’t willing to pay more for the business’ services, then the business is in deep trouble. Even, as in this case, the customer would like to spend more money on the business’ product, they may not have it (even given the power to tax, which most customers don’t have), the business is in deep trouble.
While it’s nice that the Legislature is considering paying more for these health care services (with our money), it would also be nice if they considered, in this light, the plight of private businesses that will be forced to raise the prices for their goods and services and that have customers who are unwilling or unable to pay those increases. These businesses do not have the luxury of petitioning politicians for a big chunk of taxpayer money to make up the differences in their budgets. These businesses are just in deep trouble.