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Tag: welfare state

  • Question 3: Should ride-hailing drivers be allowed to unionize?

    Question 3: Should ride-hailing drivers be allowed to unionize?

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    BOSTON — Voters in November will get a chance to resolve a fight over unionizing Uber and Lyft workers with a proposal that calls for reshaping the employment status of ride-hailing drivers who work now as independent contractors.

    Question 3, which appears on the Nov. 5 ballot, would authorize ride-hailing drivers to form unions to collectively bargain with so-called transportation network companies for better wages, benefits, and improved terms and conditions of work.

    A yes vote would create an exemption to the state’s collective bargaining laws and set up a system allowing drivers unionize. A no vote would keep the status quo, where ride-hailing drivers are considered independent contractors with a limited wage and benefit guarantees.

    Backers of the measure say while pay and benefits for the job have increased under a settlement in June with the Attorney General’s Office – including a guaranteed $32.50 minimum wage and other new driver benefits, such as earned sick pay – they want the security of unionization.

    “We help our neighbors get to work and school and bring them home to their families, and we deserve the pay and treatment on the job that will let us support our families and keep a roof over our heads,” Betania Gonell, an Uber and Lyft driver from North Andover, said at a rally at the Statehouse last month.

    “We want a union to help us negotiate for better pay, working conditions and job protections, just like nurses, bus drivers and millions of other workers in Massachusetts.”

    Over the past year, supporters of the measure collected tens of thousands of signatures to put the question before voters in November and survived a legal challenge seeking to strike it from the ballot.

    Among those backing the changes are the Service Employees International Union Local 32BJ and International Association of Machinists, which formed a coalition with progressive and social justice groups earlier this year to push for its approval.

    The outcome of the ballot question could have far-reaching impacts. Massachusetts has seen the number of ride-hailing trips rise from 39.7 million in 2021 to 60.6 million in 2022 – a more than 52% increase, according to state data. There are more than 200,000 approved ride-hailing drivers in the state, but it is not clear if all of them are now working.

    Like most states, Massachusetts has wrestled for years with the issue of how to classify ride hailing drivers. Uber, Lyft and other companies have long argued that their drivers prefer the flexibility of working as independent contractors, not employees. They have cited surveys of drivers saying they prefer contractual work.

    In June, Uber and Lyft dropped plans for a separate ballot question to classify their drivers’ employment status after reaching a deal with the state Attorney General’s Office to boost wages and benefits. The companies also agreed to pay $175 million to the state to resolve the AG’s allegations that they violated the state’s wage and hour laws.

    The agreement requires the companies to pay drivers a minimum wage of $32.50 per hour. Drivers also receive expanded benefits, including paid sick leave and a stipend to buy into the Massachusetts paid family and medical leave program.

    The settlement stems from a lawsuit originally filed in July 2020 by then-Attorney General Maura Healey, who is now the state’s governor.

    But drivers who support Question 3 argue that the proposal would provide more job security and the ability to bargain collectively for better pay and benefits in the future.

    While there is no organized opposition to Question 3, critics argue the move could lead to higher prices for Uber and Lyft rides if the companies pass along the added labor costs to consumers.

    That includes the state’s Republican Party, which says approval of the referendum “threatens the flexibility and affordability” that make ride-hailing services so popular for drivers and those who use the services.

    “It would also set an unfairly low threshold for unionization votes, potentially violating federal labor laws,” MassGOP Chairwoman Amy Carnevale said in a recent statement. “With Massachusetts already being one of the most expensive states to live and do business in, adding more red tape and higher costs is the wrong approach.”

    The conservative Massachusetts Fiscal Alliance, which also opposes Question 3, argues that its approval would not improve the situation for most ride-haling drivers because they will “have no control over leadership of the union and will pay significant dues without real representation.”

    Recent polls have shown a slim majority of voters support approval of Question 3, one of five questions before voters in the November elections.

    A report by Tufts University’s Center for State Policy Analysis found that Question 3, if approved, will likely face significant legal challenges, but it could give workers new power to bargain for better wages and benefits.

    Christian M. Wade covers the Massachusetts Statehouse for North of Boston Media Group’s newspapers and websites. Email him at cwade@cnhinews.com.

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    By Christian M. Wade | Statehouse Reporter

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  • Few prepared to cover long-term care costs

    Few prepared to cover long-term care costs

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    Editor’s note: The share of the U.S. population older than 65 keeps rising – and will for decades to come. Since nearly half of Americans over 65 will pay for some version of long-term health care, CNHI News and The Associated Press examined the state of long-term care in the series High Cost of Long-Term Care, which began Friday and continues this week.

    While many Americans will need long-term care as they get older, few are prepared to pay for it.

    Medicare, which provides Americans over the age 65 with health insurance, doesn’t cover most long-term care services. And Medicaid — the primary safety net for long-term care coverage — only covers those who are indigent.

    Federal estimates suggest 70% of people ages 65 and older will need long-term care before they die, but only 3% to 4% of Americans age 50 and older are paying for long-term care policies, according to insurance industry figures.

    The high cost of premiums for those private long-term care policies puts it out of reach for most people.

    Even some who have this kind of insurance find it doesn’t provide enough to cover the costs of home health aides, assisted-living facilities or nursing homes.

    “People think that long-term care insurance is for everyone — but it is not,” said Jessie Slone, executive director of the American Association for Long-term Care Insurance, an advocacy group. “It’s for a very small subset of individuals who plan, and have some retirement assets and income they can use to pay for it.”

    To qualify, applicants need to pass a health review. Slone said insurance companies have underwriting policies with “page after page” of conditions that will disqualify people from getting that coverage.”If you live a long life, the chances of you needing care are significant. So then the issue becomes who’s going to provide for that care, and who’s going to pay for it. For some, long-term care insurance is an option.”

    Prices vary, based on the age when people apply, how good their health is at the time, and how much coverage they want. “You have to start looking at this generally in your 50s or 60s,” Slone said. “Because, as you get older, you’re going to have conditions which insurers are going to look at, determine that you’re very likely to need long-term care and not give you a policy.”

    That coverage, if you can get it, doesn’t come cheap: In 2023, the annual average cost for a policy for a couple both age 55, taking out a $165,000 initial pool growing at 3% compounded annually — ranged from a low of $5,018 to $14,695 a year, according to the association.

    But, compared to auto insurance — which most people may never use — long-term care insurance is a good investment for those who can afford it, Slone said. “Car insurance is the most expensive insurance you ever pay because the chances of you getting into a car accident are somewhat remote. But the chances of someone needing long-term care if they make it to 90 are pretty significant.”

    Lori Smetanka, executive director of the National Consumer Voice for Quality Long-Term Care, a national nonprofit advocacy group, views it differently. She said the private long-term care insurance system has become a “bust” amid rising premiums and difficulties accessing benefits.

    Consider the fact that the number of companies offering long-term care insurance is declining, while payouts are steadily increasing as the baby boomer generation ages.”Most people have found it very expensive,” Smetanka said. “But, at the same time, people are finding that it wasn’t covering what they needed.”

    Last year, insurers paid a record of more than $14 billion to cover an estimated 353,000 long-term care claims, according to industry figures. That’s compared to about $11.6 billion just three years ago.

    Currently, there are about 7.5 million people in the U.S. age 65 and older with private long-term care insurance, according to industry data.

    With that incentive, some states, including Washington and California, are looking at creating long-term care social insurance pools funded by payroll taxes and other sources of funding. The effort also is being spurred, in part, by the rising costs borne by states for Medicaid long-term care coverage, which they share with the federal government.

    “More and more states are coming to the conclusion that this is an under-funded system,” said Marc Cohen, a researcher and co-director of the LeadingAge LTSS Center at the University of Massachusetts at Boston. “There are simply not enough dollars going into the system – given the needs and the demands of the growing elderly population.”

    So far, Washington is the only state to try to address the issue. A law approved by the state Legislature in 2019 created a long-term care benefit program, which provides residents with up to $36,500 to pay for costs such as caregiving, wheelchair ramps, meal deliveries and nursing home fees.

    The Cares Funds is covered by a payroll tax that deducts 0.58% out of paychecks but guarantees a $36,500 lifetime benefit for those who have paid into the fund for 10 years.

    Several other states are studying the issue. In California, a task force is looking at how to design a long-term care program, according to the National Conference of State Legislatures. Massachusetts, Illinois and Michigan also are weighing the costs versus benefits of creating a state long-term care benefits program.

    But the issue of imposing new taxes to pay for long-term care insurance is controversial — and politically unpopular — on both a state and federal level.

    Washington’s long-term care insurance law is facing a repeal effort from a group backed by hedge fund executive Brian Heywood that argues the system should be voluntary. Voters in November will decide whether to allow people to opt out, which supporters say would essentially gut the program.

    “There are a lot of states that are looking to see what happens in Washington,” Cohen said. “If this billionaire who is funding this repeal effort wins, it will be a real blow.”

    Cohen said efforts on a federal level to create a publicly funded insurance pool haven’t gained much traction. A long-term care program created by Congress through the CLASS Plan, which was tied to the Affordable Care Act, was voluntary. That law was repealed in early 2013.

    “It never got off the ground before it was repealed,” he said. “With the dysfunction in Congress, we’re likely to see more action on a state level than the federal.”

    Recent polls suggest there may be some public support for the move. A survey by the National Council on Aging found more than 90% of the 1,000 female respondents across party lines support the idea of creating a government program to pay for the cost of long-term care.

    “The level of support was significant, and very bipartisan,” said Howard Bedlin, a long-term care expert with the council. “People keep talking about how Congress can’t find bipartisan support. Well, the voters clearly support it.

    “The politicians just aren’t giving these issues the attention they deserve.”

    Christian M. Wade is a reporter for North of Boston Media Group.

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    By Christian M. Wade | CNHI News

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  • Safety net hospital fund shortfall widening

    Safety net hospital fund shortfall widening

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    BOSTON — Lawmakers are seeking more support for the state’s safety net hospitals amid rising concerns about the fiscal health of a fund that helps cover medical costs for large numbers of uninsured and low-income patients.

    Hospitals and health insurers pay into the so-called safety net fund – a pool of money that helps fund care for hundreds of thousands of low-income residents who are uninsured or underinsured – with the state chipping in additional funding. But if the fund runs low, hospitals are on the hook for the shortfall.

    The fund is projected to have a shortfall of more than $220 million in the upcoming fiscal year, hospitals say, rising to the highest level in nearly two decades.

    Without additional funding, financially challenged hospitals will be forced to cover the deficit, leaving less money to provide medical care for low-income and uninsured patients, they say.

    An amendment to the Senate’s version of the $57.9 billion state budget filed by Sen. Barry Finegold, D-Andover, would require commercial health insurance companies to cover 50% of any revenue shortfalls in the safety net fund.

    “We need to do something to help our local hospitals,” Finegold said. “This is part of a long-term problem with funding for hospitals that serve the state’s most vulnerable residents. We need to fix it.”

    Many earmarks

    Finegold’s proposal is one of more than 1,000 amendments to the Senate’s budget, many of them local earmarks seeking to divert more state money to local governments, schools, cash-strapped community groups and nonprofits. Only a handful will likely make it into the Senate’s final spending package.

    The plan faces pushback from the Massachusetts Association of Health Plans, which represents commercial insurers who would be impacted by the proposed changes to the hospital safety net program.

    Lora Pellegrini, the group’s president and CEO, said requiring insurers to cover the fund’s shortfalls would jeopardize negotiations between the state Department of Health and Human Services and the U.S. Centers for Medicare and Medicaid Services that seek to reduce assessments paid by medical insurance carriers.

    “This really came out of nowhere, and would be counterproductive to those efforts,” she said. “We have a committee process for a reason and that’s where these kinds of special interest issues should be vetted, not in the budget.”

    But the move is backed by the Massachusetts Health and Hospital Association, which says requiring insurers to cover the shortfall would help alleviate an “unmanageable financial burden” on the health care system “by broadening funding support for the program.”

    “The Health Safety Net is a vital component of Massachusetts’ healthcare infrastructure and its ability to cover the costs of care for low-income and uninsured patients,” Daniel McHale, MHP’s vice president for Healthcare Finance & Policy, said in a statement.

    “At this increasingly fragile time for the entire health care system, it is imperative that we take the steps needed to stabilize the safety net for the people and providers who rely on it each day.”

    Local hospitals affected

    The state’s safety net hospitals and community health centers – which include Lawrence Hospital, Salem Hospital, Holy Family Hospital in Methuen and Anna Jaques Hospital in Newburyport – serve a disproportionate percentage of low-income patients.

    Many are heavily dependent on Medicaid reimbursements, which are typically less than commercial insurance payouts.

    Nearly 30% of Lawrence General’s gross revenue is for care provided to Medicaid, or MassHealth, patients. The state average is 18%.

    Many community hospitals are collecting from low-paying government insurance programs, and getting below-average reimbursements from commercial insurers, advocates say.

    Lawmakers also swept money from the hospital safety net fund to help cover the costs of new Medicare savings programs that pay some or all of eligible senior citizen’s premiums and other health care costs, including prescriptions.

    Hospitals are also seeing increased demand from uninsured patients as hundreds of thousands of Medicaid recipients see their state-sponsored health care coverage dropped following the end of federal pandemic-related programs, which is driving up costs. Claims processing problems are another factor adding to hospital costs, they say.

    Those and other factors have widened the fund’s shortfall from $68 million in fiscal 2022 to more than $210 million in the previous fiscal year, according to the hospital association. Combined, the shortfall could reach $600 million for the three fiscal years, the association said.

    Biggest expense

    The House, which approved its $58.2 billion version of the state budget two weeks ago, proposed $17.3 million in state funding for the hospital safety net fund. The Senate, which begins debate on its version of the budget next week, has proposed a similar amount.

    In the current budget, the state allocated $91.4 million for the safety net fund.

    But the House budget didn’t include an amendment requiring insurers to help hospitals pay the shortfall. That means even if the Senate approves Finegold’s amendment, it would still need to be negotiated as part of the final budget before landing on Gov. Maura Healey’s desk for consideration.

    Health care coverage, in the meantime, is one of the state’s biggest expenses. Medicaid costs have doubled in the past decade and now account for nearly 40% of state spending.

    MassHealth serves more than 2 million people – roughly one-third of the state’s population – despite federal Medicaid redeterminations that have reduced its rolls over the past year.

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    By Christian M. Wade | Statehouse Reporter

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