Over the last few years, there has been a lot of debate around the interpretation of companion services under the Fair Labor Standards Act (FLSA). In 2015-2016, the Fair Labor Standards Act (FLSA) revoked the ability of Home Care Employers to invoke the companionship services clause to not pay overtime.

This change has significantly increased the number of employees with overtime protection. Private Duty Home Care agencies providing skilled and non-medical services will need to monitor employee overtime and minimize it during scheduling. Home Care Software with tools to monitor overtime during scheduling is necessary to manage overtime for home care agencies.

Understanding the FLSA and Revocation of Exemption for Companionship Services

Subject to certain exemptions, the FLSA requires employers to pay minimum wage and time-and-a-half overtime pay to all their employees. One such exemption was about “companionship services” provided by “domestic service” workers who provide personal care (private duty) services to the elderly, ill, or disabled in their homes.

Historically, a domestic service worker was not entitled to the FLSA’s minimum wage and overtime guarantees, regardless of who employed the worker. As home care agencies began to provide these services, the definition of home care services needed to change as technically this was now an employed workforce vs. a directly contracted domestic worker.

The companionship services exemption to minimum wage and overtime pay isn't applicable when the employee spends more than 20 percent of the workweek performing care services. In such a week when the employee spends more than 20 percent of the workweek providing care services, the employee is entitled to minimum wage and overtime pay.

In response, the Department of Labor (DOL), which enforces the FLSA, amended the act and added a rule that third party employers could no longer invoke the “companionship services” exemption for its domestic service employees.

Overtime Wages for Home Care Workers

Employees of Home Care Agencies, entitled to overtime pay, will receive one and a half times their normal rate for every hour worked over 40 hours a week. Most of the states follow this rule even though some states like California have more stringent rules for overtime.

Impact on Home Care Agencies

Even though these rules have now been in vogue for a while, most private duty nursing and non-medical agencies have to strike a careful balance between the high quality and continuity of care they provide and minimizing the overtime cost.

With falling reimbursements from third-party payers, and trying to strike a balance between expectations and quality of service for private pay patients, most home care agencies are trying to adapt their business models to limit caregivers to 40 hours a week. Not many patients will be willing or able to pay the cost of overtime hours. This will force the agencies to optimize the utilization of their caregivers' time to reduce overtime pay. For high hour patients, agencies will be forced to schedule multiple employees to keep the employees from going into overtime.

Tracking work hours

By definition, the implementation of overtime pay rule necessitates that you should track the hours worked by each of your caregivers. All hours worked have to be on record and paid at the regular rate for 40 hours-a-week and at 1.5 times the regular rate for each hour worked beyond 40 hours.

The following hours will constitute as work hours:

All hours spent at a patient’s home
The time spent traveling between patient homes during the workday.
Time spent in Training and official meetings.

Manage overtime with automation

Manual tracking of work hours and self-declaration of travel time by employees will lead to errors and inefficiencies. A Home Care software solution that can track work hours and travel time at the time of scheduling, not after the shifts are completed, will be critical for private duty home care agencies to manage and minimize overtime.

Simple and easy to use scheduler with the following features will help agencies:

Intelligent search options to suggest matching employees based on overtime and other skills
Provide a list of employees who will not go into overtime after adding the shift
Provide a list of employees closer to patients’ homes
Automatically calculate travel time during scheduling
Provide a warning or hard stop when the employee goes into overtime
Recalculate overtime when shifts are changed frequently.
Provide exception reports for overtime.
Payroll interface to payroll systems such as Quickbooks, ADP, etc.

Continuity of Care and Patient Satisfaction

Home care agencies will not have to sacrifice the quality of service or patient satisfaction while using multiple employees for high hour patients. A Home Care Software with the following tools will help agencies to maintain quality and patient satisfaction.

Electronic Aide Care Plan with tasks to be performed for patients
Changes to the care plan available at POC in real-time
Document tasks at Point of Care
Monitor shifts in real-time to manage missed shifts
Option to view care summary and care plan before starting the shift
Secure messaging tools to communicate with the agency

ABOUT CAREVOYANT

CareVoyant is a leading provider of cloud-based integrated enterprise-scale home health care software that can support all home-based services under ONE Software, ONE Patient, and ONE Employee, making it a Single System of Record. We support all home based services, including Home Care, Private Duty Nursing, Private Duty Non-Medical, Home and Community Based Services (HCBS), Home Health, Pediatric Home Care, and Outpatient Therapy at Home.

CareVoyant functions – Intake, Authorization Management, Scheduling, Clinical with Mobile options, eMAR/eTAR, Electronic Visit Verification (EVV), Billing/AR, Secure Messaging, Notification, Reporting, and Dashboards – streamline workflow, meet regulatory requirements, improve quality of care, optimize reimbursement, improve operational efficiency and agency bottom line.

For more information, please visit CareVoyant.com or call us at 1-888-463-6797.