As America ages, states are investing in home-based care for the elderly and disabled in hopes of keeping people out of nursing facilities—and maybe saving money in the bargain. Before going too far, they should study how that approach has—and hasn’t—worked in New York.
New York’s Medicaid program spends far more than any other on the nonmedical form of home care known as personal care or personal assistance, which covers services such as bathing, dressing, feeding and housekeeping for people who can’t manage those tasks on their own. According to a federal analysis of 2019 Medicaid spending, the Empire State’s annual personal-care outlays of $12 billion were the largest in the nation, and nearly as much as the other 49 states combined. Its per capita expenditures were eight times the U.S. average.
That extraordinary spending has produced an extraordinarily large workforce. The number of home health aides employed in New York soared to 480,000 in 2021 from 250,000 in 2011, accounting for almost two-thirds of the state’s net job growth during that period. Their ranks now outnumber both retail clerks and fast-food counter workers. Home health employment is especially heavy in New York City, which has 236 aides for every 1,000 residents 65 or older, quadruple the national rate. For the U.S. as a whole to match that level, it would need to add nine million aides—roughly the population of New Jersey.
As the Empire Center’s senior fellow for health policy, Bill Hammond tracks fast-moving developments in New York’s massive health care industry, with a focus on how decisions made in Albany and Washington affect the well-being of patients, providers, taxpayers and the state’s economy.